Take-Two, one of the giants of the industry which own some of the most profitable franchises ever, has released its earnings in the first quarter of the 2020 financial year and they’ve been some of the best yet in the company’s history. They generated $540.5 million in the first quarter which is a 39% growth over FY2019.
Interestingly, about 58% of that number is thanks to recurrent user spending. DLC, microtransactions and add-ons within hugely popular games such as GTA Online and Red Dead Redemption 2 as well as record-breaking numbers coming from NBA 2K19. This year marked a 31% growth in recurrent user spending compared to the company’s first-quarter last year. Also, digital sales now account for 79% of the company’s revenue.
This news is huge in ways you might not think. This gives executives ammo to cram even more in-game spending into their games since there is clearly a significant growth in this practice. Shareholders will look at these numbers in joy and encourage behaviour that increases these percentages even more. However, also bear in mind that Take-Two has gravitated towards live service games much more aggressively in the last few years so these numbers shouldn’t really be a surprise.